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- Tax-Aware Long Short (TALS)
TALS™: Tax Aware Long Short Strategy
An advanced investment and tax-aware strategy built for high-income, high-asset investors seeking an improved portfolio while reducing taxes on both ordinary income and capital gains, strengthening after-tax outcomes.
Understanding TALS™: A Smarter Approach to Reducing Tax Drag
High-income, high-asset investors often face substantial tax drag, particularly when taxable portfolios, concentrated stock positions, consistently high wage or business income, or major liquidity events push them into the highest brackets. Traditional approaches can help, but they often fall short for investors with more complex financial lives.
TALS™ — True Wealth Design’s Tax-Aware Long-Short strategy — is designed to address this challenge. It integrates a disciplined long-short investment approach to seek improved diversification and stronger pre-tax returns, while applying tax-aware trading to intentionally realize losses and create Tax Assets. These Tax Assets can then help mitigate taxes on both ordinary income and capital gains.
Rather than relying on occasional or reactive tax-loss harvesting, TALS™ uses a systematic process intended to deliver more consistent and lasting tax-management benefits over time. For investors with significant taxable wealth, TALS™ may provide a more effective way to manage tax impact and enable more flexible, multi-year planning.
- Institutional-Grade Investment Framework. TALS™ is grounded in a rigorous investment process that blends diversified long-short construction, evidence-based factor research, and institutional-level risk management. While tax-aware trading is a defining feature, the strategy is built on a framework designed to first strengthen pre-tax return expectations and improve diversification.
- Capitalize on Market Volatility. Individual stocks are often several times more volatile than a diversified fund. This volatility creates dispersion between securities, which TALS™ uses to realize losses and build Tax Assets.
- Systematic Loss Generation. By extending beyond long-only exposure and incorporating a disciplined short component, TALS™ may generate realized losses across a wide range of market environments — providing more consistent and durable loss-realization potential than traditional tax-loss harvesting or Direct Indexing strategies.
- Coordinated SMA + LP Design. For qualified investors, TALS™ may be implemented using both a separately managed account (SMA) and a limited partnership (LP). The SMA’s tax-aware trading seeks to realize losses, which may offset gains generated within the LP. The LP’s structure and strategy may also produce business losses that can offset other income, subject to IRS rules and applicable limits.
- Multi-Year Integration. TALS™ must be thoughtfully integrated into your financial, investment, and tax plans through time. It may complement strategies such as Roth conversions, diversifying concentrated positions, preparing for liquidity events, and other multi-year planning opportunities. As these opportunities evolve — and as markets change — your TALS™ implementation and related planning may need to adapt as well.
When a TALS™ Strategy May Make Sense
TALS™ is designed for investors whose financial lives involve meaningful taxable assets, complex income streams, or upcoming events that may create significant tax exposure. The strategy is most effective when integrated into a broader financial plan, helping support long-term goals while addressing the tax considerations that come with higher income and wealth. Whether you are navigating concentrated stock, planning for a liquidity event, or managing multi-year tax planning, TALS™ may offer tools that align with your broader objectives.
Business Owners Preparing for a Liquidity Event
Business Owners Preparing for a Liquidity Event
TALS™ may help manage the tax impact of a future business sale by creating more flexibility around gains and income timing, depending on the structure of the sale and individual tax profile.
High-Income Professionals
High-Income Professionals
Physicians, attorneys, partners, and executives with substantial W-2 or K-1 income may benefit from enhanced tax-management strategies within their taxable portfolios.
Investors With Large Capital Gains
Investors With Large Embedded Gains
Those looking to diversify concentrated stock or long-held positions may find TALS™ supportive of a more tax-efficient transition, depending on their investment and tax circumstances.
Executives With Stock-Based Compensation
Executives With Stock-Based Compensation
TALS™ may help support planning around RSUs, options, and vesting events that could otherwise create significant tax exposure.
Families Managing Multi-Generational Wealth
Families Managing Multi-Generational Wealth
Large taxable portfolios can experience meaningful cumulative tax drag. A strategy like TALS™ may help improve multi-year planning across generations.
Anyone Anticipating a Future Income Spike
Anyone Anticipating a Future Income Spike
Roth conversions, asset dispositions, investment realignments, or other taxable events may benefit from coordinated planning that TALS™ can help support.
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The Strategy Once Reserved for $30M+ Investors May Now Be Available to You
Discover how True Wealth Design’s TALS™ strategies are designed to pursue enhanced after-tax outcomes and potential six-figure savings for entrepreneurs, executives, and other high-income, high-asset investors.
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